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Thursday, 8 January 2015

Disclosure of customer names and reputational concerns: Wobben gets its way

Wobben Properties GmbH v Siemens Public Ltd Company and others[2014] EWHC 3173 (Pat) is a Patents Court, England and Wales, decision of Mr Justice Morgan that dates back to early December of last year. Sorry about the delay in blogging it, but we are all over-stretched and this blog desperately needs more blogging fire-power. This decision is one of the many which deal with the nuts and bolts of procedural issues in pursuit of enforcement at national level.

Wobben, which held a European patent -- which was soon to expire -- for a method of operating a pitch-controlled wind turbine, maintained that Siemens had infringed its patent by making, marketing and supplying wind turbines to its customers which incorporated that patent's technology. The seven other defendants were said to have infringed the patent in the course of developing various wind farms which used Siemens' wind turbines or by installing wind turbines for Siemens and other defendants. Inevitably the defendants challenged the validity of Wobben's patent.

Wobben was concerned, that even if it succeeded against Siemens and the other seven defendants in this action, it might still have to press ahead with legal action against the end users of the technology, because the use of the technology was so very profitable. While Wobben had identified Siemens' customers within the jurisdiction, it didn't want to sue them all -- just those which had used the technology. It therefore wanted Siemens to identify the instances in which the technology had been activated so that Wobben could invite them to be bound by the decision in this action or to be joined as parties to it, thereby saving time and costs. Wobben therefore applied for a Norwich Pharmacal order that Siemens disclose the names of the customers concerned.

Siemens resisted the application, arguing that the disclosure of the information would cause it reputational damage.

Morgan J granted the application. In his view:

* the jurisdictional requirements for making a Norwich Pharmacal order had been made out. If the technology had been activated, resulting in its use by a customer, there was an arguable case of infringement which Siemens would have facilitated; Siemens had the information that Wobben asked for, and Wobben was not able to know which customers had arguably committed patent infringement by using the technology unless Siemens told it that which customers the technology had been activated for

* in proceedings against the end-users, the time and resources of Wobben and of the court would be wasted if the issue of the patent's validity were to be raised again.

* As for reputational damage likely to be suffered by Siemens, it was actually the case that Siemens ran a higher risk of exposure to even greater reputational damage, involving more customers, if it didn't provide the information sought. This was because Wobben was likely to make claims against more customers if it didn't know which ones to sue than it would if Siemen eliminated the customers which had not used the technology.

* it was not appropriate to have a mini trial in relation to the assertions and counter-assertions about reputational damage. Rather, the court should simply assess the likelihood (or risk) of serious harm coming about. On this basis Siemens would be better off if the court made the order sought, leaving it to Siemens to put its own spin on it via its own customer communications.

* while Wobben could could have made its application sooner, it would be disproportionate to deny it a Norwich Pharmacal order on the ground of delay.

This decision seems to be a sensible and practical one, particularly when viewed from the perspective of the efficient use of the court's time and resources -- an issue that the House of Lords did not consider when it first contemplated the availability of such orders back in 1973.